North Carolina laws and regulations : a guide for ABC board members

North Carolina
Laws and Regulations
A Guide for
ABC Board Members
January 26, 2010
Congratulations! You have been appointed to serve your community with a
special trust as an ABC board member.
In North Carolina, the voters decide whether their community will have liquor
available for sale in ABC stores and at bars and restaurants. In 98 of our
state’s 100 counties voters have said yes.
That is where you, the members of the local Alcohol Beverage Control Board,
come in. While 18 other states control the wholesale sale of liquor as we do,
and nine of those control retail, North Carolina is alone in asking local ABC
Boards to manage the retail sale of liquor in their communities.
As ABC board members, you are appointed by your elected county or munici-pal
leaders and you have authority over the administration of the real estate,
personnel and retail sales of liquor in your community. You are an indepen-dent
unit of government, and your community is counting on you to be a
good steward of public funds and to maintain safe and orderly sales of liquor.
As ABC board members you also have a responsibility to be familiar with and
to operate within the boundaries of the laws and rules that apply to alcohol
in your community and the state. The North Carolina Alcoholic Beverage Con-trol
Commission is a resource for you, should you have any questions about
how these laws and regulations apply in specifi c instances. The information
in this booklet provides you with an overview, and additional information is
available by calling our offi ces at 919-779-0700 and requesting a copy of the
most current edition of the Alcoholic Beverage Control Laws and Regulations
of North Carolina.
Thank you for your willingness to serve your community and your state as a
leader of your local ABC Board.
Message from the
North Carolina ABC Commission Chairman
North Carolina General Statute (N.C.G.S.) 18-B-700 Appointment
• Membership - A local board shall consist of members
appointed by the local appointing authority as specifi ed by
law. The appointing authority shall designate one member
of the local board as chairman.
• Qualifi cations - Appointments shall be made based on
the appointees’ interest in public aff airs, good judgement,
knowledge, ability, and good moral character.
• Removal - A board member may be removed for cause at
any time by the appointing authority, a judge or the State
ABC Commission.
• Salary - A local board member may be compensated
as determined by the appointing authority. No other
compensation may be provided by the local ABC board.
• Confl icts of Interest - A board member shall not have any
direct or indirect interest in any ABC enterprise or personally
benefi t fi nancially in any manner while acting on behalf of
the ABC board. The ABC Commission may grant exceptions
in cases where the public interest would not be placed in
jeopardy.
• Bond - Each board member, store manager, and/or other
board employee who handles funds shall be bonded in an
amount not less than $5000 and secured by a corporate
surety. A public employees’ blanket position bond in the
required amount is satisfactory.
Opening an ABC Store
• Location of Stores - Local boards may choose the location
of the ABC stores within their jurisdiction subject to the
approval of the State ABC Commission.
• ABC Store Approval - The opening of any ABC store will
not be approved by the ABC Commission, unless at least a
30 day notice is given.
• ABC Store Investigation - The North Carolina Alcohol Law
Enforcement Division will investigate all new ABC store
applications and submit its fi ndings to the ABC Commission
for review.
• Required Sign Posting - All boards shall post a sign for 30
days at the site informing the public of a proposed ABC
store.
2R.0909 Travel Policies
• Each local board is required to adopt and adhere to rules
establishing travel policies that conform, at a minimum, to
travel policies adhered to by either the local appointing
authority or the Offi ce of State Budget and Management
and shall fi le a certifi ed copy with the ABC Commission.
Personnel Manual
• Each local board shall establish policies and rules to
include, but not limited to those set out in 2R .1009, using the
policies adopted by their appointing authority as a guide.
An up-to-date copy of the manual shall be on fi le with the
Commission. Any time the manual is updated or amended,
a copy of the proposed changes shall be submitted to the
Commission for approval.
Financial Operations
• Accounting System - Each board shall establish and
maintain an accounting system designed to show in detail
its assets, liabilities, equities, revenues and expenses.
All boards are encouraged to use the chart of accounts
prescribed by the Commission (18B-204).
• Borrowing Money - A local board may borrow money
only for the purchase of land, buildings, equipment and
stock needed for the operation of its ABC system. A city or
county whose local governing body appoints a local board
shall not in any way be held responsible for debts incurred
by the board.
• Audits - Local boards are required to submit an
independent annual audit to the ABC Commission. Audits
are due to the Commission 90 days after the end of the
fi scal year (on or before September 30).
• Deposits - Deposits shall be made daily. All monies are
public funds and shall be governed by rules of the ABC
Commission and laws of the State of North Carolina.
• Working Capital - A board’s total cash, investments and
inventory less all unsecured liabilities shall not exceed four
(4) months average gross sales of the latest fi scal year.
“Every dollar that comes into the ABC system in this state is
a dollar that belongs to the public. The public’s money is not
what is left over at the end. It is public the moment it is handed
over the counter.” Chairman Jonathan Williams
N.C.G.S. 18B-701 Powers
A local board shall have the following powers:
1. Buy, sell, transport, and posses alcoholic beverages as
necessary for the operation of its ABC stores;
2. Adopt rules for its ABC system, subject to the approval of
the ABC Commission;
3. Hire and fi re employees for the ABC system;
4. Designate one employee as manager of the ABC system
and determine his/her responsibilities;
5. Require bonds of employees;
6. Operate ABC stores;
7. Issue Purchase-Transportation Permits;
8. Employ local ABC offi cers or contract with state or local law
enforcement for enforcement;
9. Borrow money;
10. Buy and lease real and personal property and receive
property bequeathed or given necessary for the
operation of the ABC system;
11. Invest surplus funds;
12. Dispose of property; and
13. Perform any other activity authorized or required by law.
Purchasing Guidelines
• NC ABC boards must follow the statutory provisions
controlling purchasing by local governments. The Institute
of Government at the University of North Carolina at Chapel
Hill has compiled all the necessary statutes in an easy to
read format pertaining to purchasing.
N.C.G.S. 18B-800 Sale of Alcoholic Beverages
• ABC stores may sell only spirituous liquor and fortifi ed
wine.
• Except for special orders, no ABC store may sell any
alcoholic beverage that has not been approved for resale
by the Commission (2R.1401).
• Special orders are in case quantities, must be pre-paid by
the customer, and cannot be placed on the retail shelf.
• Only those mixers that were classifi ed as fortifi ed wine
prior to July 7, 2004 may be sold in ABC stores.
• The retail price of spirituous liquor sold in ABC stores shall
be uniform throughtout the state.
2R.1407 Payment
• Bailment fees, which fund the State ABC Warehouse
operations, and distillers’ invoices shall be paid within 30
days, upon receipt of product.
• Bailment surcharge fees, which fund the operations of the
State ABC Commission, shall be paid within 15 days.
• “Within” means the payment shall be received by the
supplier in the number of days stated; a check “in the mail”
is not in compliance.
“All local ABC board monies are public funds for the ultimate
benefi t of the local city or county and should only be spent as
needed for the operation of the ABC system.” ABC Commission
2R. 1503 Special Purchase Allowances
• Temporary Price Reductions - On a monthly basis, the
Commission reduces the price of certain products to refl ect
importer or manufacturer special reductions. The retail
price reduction will stay in eff ect for 30 days.
• Supplemental Price Lists - In addition to the quarterly price
lists published in February, May, August and November,
the Commission publishes a monthly Supplemental Price
List. These shall be made available in all ABC stores, and all
reduced prices shall be posted to notify customers of the
reductions.
• Reduced Prices Eff ective Statewide - A local board that
sells a product selected for a temporary price reduction
shall sell that product at the reduced price for the entire
period the lower price is in eff ect.
2R.1004 Employment Age Requirement
• A person employed by a local board shall be at least 18
years of age unless waived by the ABC Commission.
“Any expentiture of board funds for any good or service not related
to the operation of the ABC board system is a misappropriation
of public funds. The funding of parties, gifts, or non-member/
employee travel is strictly prohibited...” ABC Commission
Operation of ABC Stores
• When Stores Operate - ABC stores may open at 9:00 am
and shall close at 9:00 pm. The local board may determine
hours of operation between these hours.
• No ABC store shall open and no ABC store employee shall
sell alcoholic beverages on any Sunday, New Year’s Day,
Fourth of July, Labor Day, Thanksgiving Day, or Christmas
Day. The local board may determine additional days on
which its stores shall be closed.
• Closing of Stores - A local board may close or the
Commission may order the closing of a store when the
local board or the Commission determines that:
1. The operation of the store is not suffi ciently profi table
to justify its continuation;
2. The store is not operating in accordance with the ABC
law; or
3. The continued operation of that store will adversely
aff ect the health, safety or general welfare of the
community in which the store operates.
• Insolvent ABC System - If the ABC system is insolvent, the
local board may apply to the Commission for an order to
close the system.
• Store Appearance - Stores shall be well-lighted and
immaculately clean at all times (2R.1703a). Every store
shall make available to its customers the most current state
price list and any supplemental price lists (2R.1703b).
2R.1701 Removal of Beverages from ABC Stores
• Spirituous Liquor - may only leave the ABC store after being
sold to a customer or returned to the State ABC Warehouse
due to damage. Any liquor leaving a local board, except under these
conditions, is prohibited.
• Distressed Liquor - Distressed liquor shall be destroyed in
the presence of the store manager or his/her designee and
a distillery representative.
• Sales to Employees - No sales of spirituous liquor shall
be made to employees, board members or other retail
customers on credit. This rule does not prohibit the use of
credit/debit cards.
2R.1902 Designation of Store
• In areas where mixed beverage sales are permitted, the
Commission may require a board to designate more than
one store to fi ll mixed beverages orders if the volume
of sales or size of the area is suffi ciently large enough to
warrant more than one store.
“A board member cannot delegate his duty of oversight. It is the
board member who holds the General Manager and the employees
of the system to the highest standard in reporting every facet of the
collection and distribution of public monies. It is the board member’s
duty to make sure that public confi dence and trust in the ABC system
is preserved.” ABC Commission
North Carolina
Alcoholic Beverage Control Commission
3322 Garner Road
Raleigh NC 27610
www.ncabc.com
(919) 779-0700 Fax: (919) 662-3583
Email: contactus@ncabc.com
Responsible Alcohol Seller Program (RASP)
Education and Training Division
(919) 779-0700 ext 238
North Carolina Association of ABC Boards
www.ncabcboards.com
(919) 828-2501

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North Carolina
Laws and Regulations
A Guide for
ABC Board Members
January 26, 2010
Congratulations! You have been appointed to serve your community with a
special trust as an ABC board member.
In North Carolina, the voters decide whether their community will have liquor
available for sale in ABC stores and at bars and restaurants. In 98 of our
state’s 100 counties voters have said yes.
That is where you, the members of the local Alcohol Beverage Control Board,
come in. While 18 other states control the wholesale sale of liquor as we do,
and nine of those control retail, North Carolina is alone in asking local ABC
Boards to manage the retail sale of liquor in their communities.
As ABC board members, you are appointed by your elected county or munici-pal
leaders and you have authority over the administration of the real estate,
personnel and retail sales of liquor in your community. You are an indepen-dent
unit of government, and your community is counting on you to be a
good steward of public funds and to maintain safe and orderly sales of liquor.
As ABC board members you also have a responsibility to be familiar with and
to operate within the boundaries of the laws and rules that apply to alcohol
in your community and the state. The North Carolina Alcoholic Beverage Con-trol
Commission is a resource for you, should you have any questions about
how these laws and regulations apply in specifi c instances. The information
in this booklet provides you with an overview, and additional information is
available by calling our offi ces at 919-779-0700 and requesting a copy of the
most current edition of the Alcoholic Beverage Control Laws and Regulations
of North Carolina.
Thank you for your willingness to serve your community and your state as a
leader of your local ABC Board.
Message from the
North Carolina ABC Commission Chairman
North Carolina General Statute (N.C.G.S.) 18-B-700 Appointment
• Membership - A local board shall consist of members
appointed by the local appointing authority as specifi ed by
law. The appointing authority shall designate one member
of the local board as chairman.
• Qualifi cations - Appointments shall be made based on
the appointees’ interest in public aff airs, good judgement,
knowledge, ability, and good moral character.
• Removal - A board member may be removed for cause at
any time by the appointing authority, a judge or the State
ABC Commission.
• Salary - A local board member may be compensated
as determined by the appointing authority. No other
compensation may be provided by the local ABC board.
• Confl icts of Interest - A board member shall not have any
direct or indirect interest in any ABC enterprise or personally
benefi t fi nancially in any manner while acting on behalf of
the ABC board. The ABC Commission may grant exceptions
in cases where the public interest would not be placed in
jeopardy.
• Bond - Each board member, store manager, and/or other
board employee who handles funds shall be bonded in an
amount not less than $5000 and secured by a corporate
surety. A public employees’ blanket position bond in the
required amount is satisfactory.
Opening an ABC Store
• Location of Stores - Local boards may choose the location
of the ABC stores within their jurisdiction subject to the
approval of the State ABC Commission.
• ABC Store Approval - The opening of any ABC store will
not be approved by the ABC Commission, unless at least a
30 day notice is given.
• ABC Store Investigation - The North Carolina Alcohol Law
Enforcement Division will investigate all new ABC store
applications and submit its fi ndings to the ABC Commission
for review.
• Required Sign Posting - All boards shall post a sign for 30
days at the site informing the public of a proposed ABC
store.
2R.0909 Travel Policies
• Each local board is required to adopt and adhere to rules
establishing travel policies that conform, at a minimum, to
travel policies adhered to by either the local appointing
authority or the Offi ce of State Budget and Management
and shall fi le a certifi ed copy with the ABC Commission.
Personnel Manual
• Each local board shall establish policies and rules to
include, but not limited to those set out in 2R .1009, using the
policies adopted by their appointing authority as a guide.
An up-to-date copy of the manual shall be on fi le with the
Commission. Any time the manual is updated or amended,
a copy of the proposed changes shall be submitted to the
Commission for approval.
Financial Operations
• Accounting System - Each board shall establish and
maintain an accounting system designed to show in detail
its assets, liabilities, equities, revenues and expenses.
All boards are encouraged to use the chart of accounts
prescribed by the Commission (18B-204).
• Borrowing Money - A local board may borrow money
only for the purchase of land, buildings, equipment and
stock needed for the operation of its ABC system. A city or
county whose local governing body appoints a local board
shall not in any way be held responsible for debts incurred
by the board.
• Audits - Local boards are required to submit an
independent annual audit to the ABC Commission. Audits
are due to the Commission 90 days after the end of the
fi scal year (on or before September 30).
• Deposits - Deposits shall be made daily. All monies are
public funds and shall be governed by rules of the ABC
Commission and laws of the State of North Carolina.
• Working Capital - A board’s total cash, investments and
inventory less all unsecured liabilities shall not exceed four
(4) months average gross sales of the latest fi scal year.
“Every dollar that comes into the ABC system in this state is
a dollar that belongs to the public. The public’s money is not
what is left over at the end. It is public the moment it is handed
over the counter.” Chairman Jonathan Williams
N.C.G.S. 18B-701 Powers
A local board shall have the following powers:
1. Buy, sell, transport, and posses alcoholic beverages as
necessary for the operation of its ABC stores;
2. Adopt rules for its ABC system, subject to the approval of
the ABC Commission;
3. Hire and fi re employees for the ABC system;
4. Designate one employee as manager of the ABC system
and determine his/her responsibilities;
5. Require bonds of employees;
6. Operate ABC stores;
7. Issue Purchase-Transportation Permits;
8. Employ local ABC offi cers or contract with state or local law
enforcement for enforcement;
9. Borrow money;
10. Buy and lease real and personal property and receive
property bequeathed or given necessary for the
operation of the ABC system;
11. Invest surplus funds;
12. Dispose of property; and
13. Perform any other activity authorized or required by law.
Purchasing Guidelines
• NC ABC boards must follow the statutory provisions
controlling purchasing by local governments. The Institute
of Government at the University of North Carolina at Chapel
Hill has compiled all the necessary statutes in an easy to
read format pertaining to purchasing.
N.C.G.S. 18B-800 Sale of Alcoholic Beverages
• ABC stores may sell only spirituous liquor and fortifi ed
wine.
• Except for special orders, no ABC store may sell any
alcoholic beverage that has not been approved for resale
by the Commission (2R.1401).
• Special orders are in case quantities, must be pre-paid by
the customer, and cannot be placed on the retail shelf.
• Only those mixers that were classifi ed as fortifi ed wine
prior to July 7, 2004 may be sold in ABC stores.
• The retail price of spirituous liquor sold in ABC stores shall
be uniform throughtout the state.
2R.1407 Payment
• Bailment fees, which fund the State ABC Warehouse
operations, and distillers’ invoices shall be paid within 30
days, upon receipt of product.
• Bailment surcharge fees, which fund the operations of the
State ABC Commission, shall be paid within 15 days.
• “Within” means the payment shall be received by the
supplier in the number of days stated; a check “in the mail”
is not in compliance.
“All local ABC board monies are public funds for the ultimate
benefi t of the local city or county and should only be spent as
needed for the operation of the ABC system.” ABC Commission
2R. 1503 Special Purchase Allowances
• Temporary Price Reductions - On a monthly basis, the
Commission reduces the price of certain products to refl ect
importer or manufacturer special reductions. The retail
price reduction will stay in eff ect for 30 days.
• Supplemental Price Lists - In addition to the quarterly price
lists published in February, May, August and November,
the Commission publishes a monthly Supplemental Price
List. These shall be made available in all ABC stores, and all
reduced prices shall be posted to notify customers of the
reductions.
• Reduced Prices Eff ective Statewide - A local board that
sells a product selected for a temporary price reduction
shall sell that product at the reduced price for the entire
period the lower price is in eff ect.
2R.1004 Employment Age Requirement
• A person employed by a local board shall be at least 18
years of age unless waived by the ABC Commission.
“Any expentiture of board funds for any good or service not related
to the operation of the ABC board system is a misappropriation
of public funds. The funding of parties, gifts, or non-member/
employee travel is strictly prohibited...” ABC Commission
Operation of ABC Stores
• When Stores Operate - ABC stores may open at 9:00 am
and shall close at 9:00 pm. The local board may determine
hours of operation between these hours.
• No ABC store shall open and no ABC store employee shall
sell alcoholic beverages on any Sunday, New Year’s Day,
Fourth of July, Labor Day, Thanksgiving Day, or Christmas
Day. The local board may determine additional days on
which its stores shall be closed.
• Closing of Stores - A local board may close or the
Commission may order the closing of a store when the
local board or the Commission determines that:
1. The operation of the store is not suffi ciently profi table
to justify its continuation;
2. The store is not operating in accordance with the ABC
law; or
3. The continued operation of that store will adversely
aff ect the health, safety or general welfare of the
community in which the store operates.
• Insolvent ABC System - If the ABC system is insolvent, the
local board may apply to the Commission for an order to
close the system.
• Store Appearance - Stores shall be well-lighted and
immaculately clean at all times (2R.1703a). Every store
shall make available to its customers the most current state
price list and any supplemental price lists (2R.1703b).
2R.1701 Removal of Beverages from ABC Stores
• Spirituous Liquor - may only leave the ABC store after being
sold to a customer or returned to the State ABC Warehouse
due to damage. Any liquor leaving a local board, except under these
conditions, is prohibited.
• Distressed Liquor - Distressed liquor shall be destroyed in
the presence of the store manager or his/her designee and
a distillery representative.
• Sales to Employees - No sales of spirituous liquor shall
be made to employees, board members or other retail
customers on credit. This rule does not prohibit the use of
credit/debit cards.
2R.1902 Designation of Store
• In areas where mixed beverage sales are permitted, the
Commission may require a board to designate more than
one store to fi ll mixed beverages orders if the volume
of sales or size of the area is suffi ciently large enough to
warrant more than one store.
“A board member cannot delegate his duty of oversight. It is the
board member who holds the General Manager and the employees
of the system to the highest standard in reporting every facet of the
collection and distribution of public monies. It is the board member’s
duty to make sure that public confi dence and trust in the ABC system
is preserved.” ABC Commission
North Carolina
Alcoholic Beverage Control Commission
3322 Garner Road
Raleigh NC 27610
www.ncabc.com
(919) 779-0700 Fax: (919) 662-3583
Email: contactus@ncabc.com
Responsible Alcohol Seller Program (RASP)
Education and Training Division
(919) 779-0700 ext 238
North Carolina Association of ABC Boards
www.ncabcboards.com
(919) 828-2501